Lawmakers question Trump administration officials over handling of $600 billion Cares Act lending program
Treasury Secretary Steven Mnuchin suggested Friday that the government should consider forgiving all taxpayer-backed small loans under the federal Paycheck Protection Program without verifying how the funds were used, a decision that could wipe away debt for millions of small businesses but would also substantially increase the risk of fraud.
The Treasury Department and Small Business Administration are grappling with how to handle millions of applications for loan forgiveness, a process that includes verifying that most of the funds were actually used to pay employees as required under the Cares Act. But Mnuchin seemed to suggest during a congressional hearing Friday that a case-by-case approval process should be waived entirely for loans below a certain threshold.
“One of the things we’ll talk about is should we just have forgiveness for all the small loans … I think that’s something we should consider,” Mnuchin said when asked by Rep. Steve Chabot (R-Ohio) how the process might be simplified. Continue reading.